When I spoke to CKNW's Jas Johal on October 6th, I mentioned that for many developments, government fees are higher than the land price. What I didn't know was that very morning this graphic was featured on the front page of the Vancouver Sun. It shows that on average, government charges, which include things like Community Amenity Contributions, Development Cost Levies, development and building fees, inspection fees, property taxes, property transfer tax, GST and Provincial Sales Tax total 35.6% of the cost of a new home. The land cost, on average, is 21%.
So if you want to see the cost of new housing reduced, hopefully this will help you understand why just increasing density isn't going to work, especially since as densities increase, land values increase.
Similarly, don't blame the contractor or the window suppliers, or even the developers for their excessive profits. No, the major cost component is government fees and charges, not just at the municipal and regional level, but also at the federal and provincial levels.
Happy Thanksgiving.
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